Are we seeing a tipping point for the
European Union or at the least for the integrity of the euro zone? The
European Union was created with such high hopes of bringing peace to
a region that had known the strife of two world wars.
Greece, which has been a member of the
EU since 1981, has been slowly unraveling economically. We are now
at a point where leaders in the EU are faced with a choice.
It's not an easy choice, billions of
euros are at stake. But is that all? Or is there something else at
stake?
Sometimes the past has lessons to
teach.
While it is understandable that no one
wants to act as a continual source of funds for an entity that does
not show any real positive change, humiliating them is not a productive
measure. It can lead to unexpected consequences.
95 comments:
I think Merkel has already decided that Greece ain't gonna get any new funds. And I think she's got the power to enforce that decision.
I guessed that wrong. Apparently Merkel didn't quite have enough power to deny Greece any further funding. But she managed to extract some cost.
"Tsipras…was subjected to a 15-hour humiliation by leaders furious
that he had spurned their previous bailout offer on more favorable
terms in June and held a referendum last week to reject it.
"One senior EU official calculated the cost to the Greek state of the
last two weeks of political and economic turmoil at 25 to 30 billion
euros."
I remembered this article from Friday; seems appropriate to remind others.
It looks like the EU has come up with more of the same as a solution.
I have to wonder if the former Greek finance minister may be correct in his theory. Other people have speculated something similar, although the scare tactics were theorized to be directed at other countries in the EU other than France.
I would think that Greek finances have been pretty much handled the same way for years. Did the EU not do any due diligence before admitting them to the EU and the eurozone? There are obvious cultural differences between the various countries. It's like a marriage where one spouse likes to spend while the other likes to save. Well, so what did everyone expect?
I don't believe that what is proposed here will work any better than it did in the past. It will just contribute to the downward spiral of the Greek economy and foster even more resentment of those in the EU who espouse the more stringent requirements. We will revisit this again in a few years...or less.
But I am getting ahead of events here. This is merely a proposal, it still needs to be voted on.
He's got more to say on the subject.
And, there's another theory going around Europe to the effect that the powers behind the EU don't exactly take too well to voters having any say in what's going to happen. There's a certain Brussels' elite element who think the common folk can't be trusted to vote the correct way and so should not be allowed to vote at all. (This may be on account of when leaders have allowed referenda on EU proposals they are almost always rejected. Only one case was an EU referendum approved--Ireland voted to join the EU, but that was only on the second try--it having failed the first time.) By this theory, Greece had to be punished for having the referendum in addition to making the mistake of standing up to Germany in the first place.
I think what's probably up for the next move is the EU will cut off liquidity loans to Greek banks which have already been approved in the amount of some €89 billion. Supposedly those are already approved, but the ECB has been doling it out in drips and drops, and will probably cut it off entirely in the next couple of days (previous approval being beside the point).
"Apparently Merkel didn't quite have enough power to deny Greece any further funding."
I believe she's gonna get another crack at it before any further funding goes out though--so she may pull it off yet. In addition, there's a good chance that she'll be able to block actual dispersement on loans supposedly already made.
Perhaps Germany won the second world war after all. They do seem to be in the driver's seat here. And not in a very classy way either. If I were a voter in one of the eurozone countries I would start to question the purpose of this economic partnership. In the long run it may be better for Greece to exit, from their perspective. They will need outside help to restart their economy though. That could mean anyone outside the eurozone. Perhaps Donald Trump has a few billion laying around he might want to invest?
Paul Krugman on the Greek crisis. Some of the comments are interesting too.
Lee: "Only one case was an EU referendum approved--Ireland voted to join the EU, but that was only on the second try--it having failed the first time"
What about when Sweden voted on joining the EU and voted yes the first time around? Because unless I'm way off I seem to remember voting in that election.
Lynnette: "Paul Krugman on the Greek crisis. Some of the comments are interesting too."
Looks like they're all blaming the ant and pitying the grasshopper.
"
"What about when Sweden voted on joining the EU and voted yes
the first time around?"
I seem to have misstated my point. That should be, ‘Only one case was a Euro referendum approved--Ireland voted to adopt the Euro, but that was only on the second try…" Although, my source for that bit of info had that part wrong anyway. (I decided to look a little deeper.) Ireland never actually held a referendum on adopting the Euro. In any case, use of the Euro is rather less popular among the great unwashed (except, apparently, in Greece) than is membership in the EU itself.
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I don't know what to think of the accord between Iran and the adversarial negotiating group. The Obama administration will claim it's a good deal, all things considered. They almost have to claim that. Their political enemies will denounce it as a sell-out--that's just what they do. We will have to see how it works out I guess.
We have avoided the worst case scenario, that the EU and UN would decide to just chuck it all and lift their sanctions without any concessions from Iran. That was a definite possibility, and we've managed to avoid that.
I think both sides have some selling to do.
Iran deal
The one sign I found the most promising was this:
The deal didn't come together easily, as tempers flared and voices were raised during debates over several of the most contentious matters.
Sounds like they actually got down to the nitty gritty.
Looks like they're all blaming the ant and pitying the grasshopper.
lol!
Well, but what it comes down to is that nobody likes a bully. And that appears to be exactly what Germany is doing. Not to mention that it may not even work, but may just make things worse.
"I think both sides have some selling to do."
The Obama administration is going to have to overcome the perception that whether to continue sanctions against Iran was somehow up to us. Like the EU and China and Russia weren't just chomping at the bits to get access to an under served market for consumer goods-and one that could pay cash for them.
"Not to mention that it may not even work…"
Will not work; demonstrably. Germany knows it won't work. The point here is to crush Greece, to make an example of them, in order to make the point to other debtor nations. It's moved well beyond the ant and grasshopper morality story.
Like the EU and China and Russia weren't just chomping at the bits to get access to an under served market for consumer goods-and one that could pay cash for them.
A repeat of Iraq.
Well, we'll see...
I should probably point out that Russia is actually looking for weapons sales more than expecting to get in on the consumer goods markets. The Chinese can hope to serve both markets.
The point here is to crush Greece, to make an example of them, in order to make the point to other debtor nations.
See, there's the thing, personally I wouldn't want to be part of an alliance that was so punitive in nature.
Some of this wasn't just about Greece, but about the banks and the easy credit, just as we saw here. This is a residue from the Great Recession. Sure you can nit pick about retirement age and pensions. Those are valid points, but it's more than that. Look at the other debtor nations in the eurozone. It's not just about the enabled but also about the enabler.
I should probably point out that Russia is actually looking for weapons sales more than expecting to get in on the consumer goods markets. The Chinese can hope to serve both markets.
Which would not happen if he arms embargo remains in place.
I would think the Chinese would also like to get into the oil market. They seem to always be looking for suppliers. Although I think they did just sign a large agreement with Russia not too long back.
Which would not happen if he arms embargo remains in place.
Which would not happen if the arms embargo remains in place.
"…if the arms embargo remains in place."
Rather, that's if the arms embargo remains in place. That requires the cooperation of Russia and China. All they need is an excuse to not cooperate; i.e. ‘the Americans won't negotiate’ or ‘the Americans walked away from an acceptable deal’ so we're gonna dump the embargo, and the arms embargo is no longer ‘in place’.
"Some of this wasn't just about Greece, but about the banks and the easy credit,
just as we saw here."
This was about Italy and Spain and Portugal and even Ireland and France owing money to German banks. ‘Don't ya'll be gettin’ no ideas ‘bout writing down those debsts’ is what this was about.
This is, in effect, about the German government now securing German bank loans that the German banks originally made without security (i.e. without collateral). And, they're doing it because they can.
This is, in effect, about the German government now securing German bank loans that the German banks originally made without security (i.e. without collateral).
Same problem as we had here, loose credit. They enabled the debtor countries. Well, making Greece destitute won't get the money back, unless of course Greece starts selling off some of its assets to pay down the debt. That will open up a whole new can of resentment.
They should have bit the bullet and written down some of that debt. I don't know, maybe I'm being too pessimistic. Maybe it will work out in the end...
"Well, making Greece destitute won't get the money back, unless…"
Once again, this is not about getting the money back from Greece. Greece is not going to pay it back. Greece cannot pay it back. What cannot be done will not be done. This is about crushing Greece to impress Italy, Spain, Portugal, Ireland, France, et al.
That's why the terms of the deal became even worse after the Greeks voted to reject the first offer and demand a write-off of some of the debt. Tsipris went back and presented the Greek's demands for a write-off of some of the debt. He spoke the evil words. Now Greece must be crushed. So, the deal becomes worse for Greece now in punishment for having spoken the evil words. (Ya'll in Italy, Spain, Portugal, et al. ya'll gettin’ this ain't ya? Don't even think ‘bout it.)
Once again, this is not about getting the money back from Greece.
Yes, I understand. But it might be better if it were just about the money. Or at least going through the motions for that purpose. Because these scare tactics could very well backfire in the long term. Or put another way, which is more important to Europe, the EU or the euro? The political union or the economic one?
*sigh*
As someone pointed out it wouldn't be fair to other countries if Greece was given a special break. I do see that. But it just seems there might have been a better way to handle this whole thing. A way that wouldn't foster so much resentment in Greece and other places in Europe. A way to spread the pain out so that ordinary people didn't have to bear such a large share of the pain.
"A way to spread the pain out so that ordinary people didn't have
to bear such a large share of the pain."
This would require that bankers who make stupid loans bear the losses themselves. This goes against the grain of most supposedly capitalist countries.
If one invests in manufacturing, or mining. or shipping, or most any industrial enterprise and loses one's shirt--generally that's what happens. Ya lost yer shirt.
If one finances the bad investments instead then the losses can be shed to the taxpayers.
Well, the Greeks shouldn't have elected a rabidly socialist government that promised way above what was ever possible for it to deliver. And that government shouldn't have selected a fucking marxist-popstar-wannabe for finance minister and sent him to "negotiate" by being a complete jackass and calling his countries' creditors "terrorists" and whatnot. You do that when you're the one lying on your back and severely dependent on the goodwill of others and you'll get crushed. Simple as that.
I ‘spect Merkel could have overlooked all that.
"Suppose you consider Tsipras an incompetent twerp. Suppose
you dearly want to see Syriza out of power. [Suppose further that you
consider Varoufakis a ‘fucking marxist-popstar-wannabe’.] Suppose,
even, that you welcome the prospect of pushing those annoying Greeks
out of the euro.
"Even if all of that is true, this Eurogroup list of demands is madness.
The trending hashtag ThisIsACoup is exactly right. This goes beyond
harsh into pure vindictiveness, complete destruction of national
sovereignty, and no hope of relief. It is, presumably, meant to be an
offer Greece can’t accept"
Paul Krugman
But the bastards had a vote (nobody allows votes on these things in the EU), and the bastards demanded a write down of German-held debt. This cannot go unpunished lest the practice spread.
By the way, isn't Greece supposed to pass a bunch of new laws by today, otherwise the deal is withdrawn anyway?
I think the German rule is that if the taxpayers bail out German bankers who made bad loans they're never gonna collect upon, then the fact that the German taxpayers picked up the bad loans (at full price mind you) magically converts them into good loans that people expect will now be paid back.
That is the north European rule on this sort of thing, isn't it Marcus?
I am disillusioned and disgusted with both sides Lee. I'd like to see the (mostly but not only german) banksters get burned AND the irresponsible and lazy debt dwellers get their much deserved and at some point inevitable austerity. Now that the banksters seem to have gotten away that doesn't mean I'm willing to finance Mr Souvlaki's early retirement that he got in return for voting, thinking only about himself mind you, for the collection of corrupt assholes that promised him the most without any actual assets to back those promises.
I feel sorry for the young greeks. I feel sympathy for individuals who worked hard and now get burned through no fault of their own. But the Greek system is rotten to the core and cannot stand.
I'm gonna take that as a negative response. Nobody actually expects those loans can be paid back; the Germans are simply still pretending.
"But the Greek system is rotten to the core and cannot stand."
Goes without saying. The Greek system will collapse and have to be rebuilt. However, the rot is not only there. I'm not sure the Greek government is substantially more corrupt than the Italians (save perhaps for their tax collectors), or the Albanians, the Bulgarians, the Serbians, or the rest of a half dozen nations I could be naming off (again, save for the tax collection system which seems to have abandoned all pretense). I do recall that the ‘banksters’ were gleefully complicit in concealing Greece's true economic picture so they could keep making those loans and keep getting their annual bonuses for securing those loans.
So, when it comes down to it, after the collapse and during the reconstruction, those young Greeks are going to have to decide whether to feed and buy medicine for their aged Greek parents or pay 100% on those loans. I'll not fault them when the time comes for choosing to rebuild Greece and keep their old folks from having to scavenge trash cans for edibles instead of paying back the money that never should have been lent to the old corrupt government in the first place.
I do question how much we might expect Germany (et al.) to actively try to obstruct any Greek recovery.
And, just for the record… Calling your creditors ‘financial terrorists’ is fairly mild stuff. That sorta stuff goes on all the time. We've negotiated with enough Koreans, Russians, Muslims, et al. to know that. I recall that here just recently the other negotiators in the nuclear negotiations with the Iranians had to get the Ayatollah to step up and calm down his negotiators because they were wasting to much time screaming insults at Secretary Kerry that nobody could get any real subjects up to the table for discussion, and they were getting tired of nothing happening except the Iranian negotiator yelling insults at Kerry.
The EU negotiators are only whining about it now ‘cause it serves their purpose to whine about it now.
Polling I'm seeing (of Greek politicians who'll vote in their parliament, not of Greek voters who sent them there), says they'll pass the package that the EU has demanded. I'm not so sure I believe that.
I reckon we'll find out soon ‘nuff.
I am disillusioned and disgusted with both sides Lee. I'd like to see the (mostly but not only german) banksters get burned AND the irresponsible and lazy debt dwellers get their much deserved and at some point inevitable austerity.
I'm getting the feeling that you are not the only one who is disgusted with all sides in this deal, Marcus.
V is for Varoufakis
[h/t Petes]
@ Lynnette,
Meet Jeb Bush; policy pronouncements from La-La Land.
This would require that bankers who make stupid loans bear the losses themselves.
Stupidity requires firing. Criminality requires charges be brought or a lawsuit filed.
If one finances the bad investments instead then the losses can be shed to the taxpayers.
Ultimately that will always be the end game in these kinds of situations. The trick is to put in place checks and balances so that doesn't need to happen. A trick that is apparently difficult to achieve by many. We have experienced all sorts of economic crises in the past that should have been enough to teach us a lesson. We're slow learners.
I'll have to check out the article later, Lee. Gotta get some work done. :)
"Now that the banksters seem to have gotten away that doesn't
mean I'm willing to finance Mr Souvlaki's early retirement that he got
in return for voting…[for who] promised him the most."
Perhaps this would be an appropriate time to point out that the northern Europe taxpayer has never been willing to finance ‘Mr Souvlaki's early retirement’; nor has he been asked to. No one credible has ever promoted the theory that Greece could continue to run heavy deficits forever, and expect to have those paid for by the Calvanists of northern Europe.
The question upon which the Greek Euro is going to break is ‘who shall bear the losses incurred by the bankers?’ Are the young Greeks gonna reimburse you for that piece of voluntary generosity towards your 1%ers?
Most of the key restrictions last for only 10 to 15 years.
Did he really think it could last forever? A deal is meant to include compromise because each side has to give something or it isn't going to happen.
All of the Republicans seem to have something against this deal. But really what it was meant to do was to delay Iran's ability to make a nuclear bomb, if they are so inclined, long enough for the world to respond. Hopefully it will do that.
"Most of the key restrictions last for only 10 to 15 years."
Likewise the agreement to not apply sanctions against Iran lasts for only 10 to 15 years. After that, it's a new day every morning.
The Iranians currently have enough nuclear material to build around 10 bombs. The technology is over seventy years old. They have the technology.
This is what we got for eight years of sanctions (since Dubya decided to go that way in 2006). They had 164 centrifuges and no fissile material back then. Now they have 20,000 centrifuges and enough fissile material for 10 bombs.
How is that the better track to follow?
Oh, and their breakout time (time it would take to actually make a functional bomb) when the negotiations were restarted was somewhere between three and six months.
Yeah, but those are inconvenient facts for those who would oppose this deal on principal because it was done by the opposing party. :( Best to ignore them if you want to make a run for President in 2016.
"Yeah, but those are inconvenient facts for those who would
oppose this deal on principal because it was done by the opposing
party."
I don't think they'd approve this deal if it were done by a Republican president either. I think their plan is to oppose any deal ‘on principal’, and that principle is their commitment to ignoring inconvenient facts, no matter which side is in office.
Speaking of inconvenient facts… Donald Trump has moved up from second to first place in the running for the Republican presidential nomination. USA Today/Suffolk Poll
"I reckon we'll find out soon ‘nuff."
It did pass. So, they agree to pretend again at least one more time.
The Greeks said yes, I don't know about the Germans yet. But I noticed that already there have been protests in Greece over this deal.
There wasn't much detail in the article I read about the reforms, other than raising the retirement age to 67, which isn't unreasonable. They raised taxes on restaurant meals to 23%, which is probably a drop in the bucket. If they are cutting actual pension benefits by a substantial amount then they are going to be hurting a lot of people, or consumers who would normally help the economy by their purchases. 50% of people receive payments from the Greek government.
Even the IMF was encouraging debt relief.
It just seems like a slow death spiral.
Donald Trump has moved up from second to first place in the running for the Republican presidential nomination.
That is seriously scary. He who screams loud enough gets the votes, I guess. *shudder*
I don't think they'd approve this deal if it were done by a Republican president either.
I don't know who they are listening to more, Israel or the Saudis.
While I may question the thought that the deal will lead to a more workable relationship with Iran, I'm not sure what better you could have hoped for.
"I don't know about the Germans yet."
I don't either. Merkel's had two shots and she's not yet been able to shut it down entirely. But, she's got one more shot at it before any money actually gets moved into Greece.
"They raised taxes on restaurant meals to 23%…"
Other details include:
"a new 13% rate to cover fresh food, energy bills, water and hotel
stays; and a 6% rate for medicines and books
The abolition of the VAT discount of 30% for Greek islands
A corporation tax rise from 26% to 29% for small companies
A luxury tax rise on big cars, boats and swimming pools"
BBC
"That is seriously scary."
On the bright side, he seems to have challenged the escaped Mexican drug kingpin known as "Shorty" Guzman. "…tweeting that he ‘would kick [Guzman’s] ass!’ only to receive back a threatening tweet from the drug lord’s account." Politico Which response seems to have had the effect of concentrating Trump's attention on his own exemplary record of support for law and order.
"I don't know who they are listening to more, Israel or the Saudis."
Glenn Hannibaugh.
Lee: "The question upon which the Greek Euro is going to break is ‘who shall bear the losses incurred by the bankers?’"
Well, there's actually not only the question of who lent the money without proper due diligence. There's also the question of who borrowed and spent it all and now sits with the debt. It's not booked as a loss just yet (although eventually much of it will be).
Lee. "Are the young Greeks gonna reimburse you for that piece of voluntary generosity towards your 1%ers?"
Me? No I never saw a dime of any of that money and I don't have my hand out for any of it. I just don't want to end up paying it either.
Lynnette: "50% of people receive payments from the Greek government."
Which is the main reason they are in the hole. The Greeks, just like Lee C, thinks Germany (or possibly Sweden, I'm not so sure) should be covering that, the past decades' credit binge worth of it at least.
The Greeks want to keep that whole deal going and demand future payments also, that's what the most recent protests are about. Not sure where Lee C, who suddenly and unexpectedly seems to have become a leftwing socialist, stands on that matter.
"We wanna keep the Euro! We don't wanna pay old loans! We don't wanna rein in our spending! We demand new loans!"
Hard to come to terms when you face that "negotiating position".
I say, like I did from the beginning, toss them out of EMU, let them go into chapter 11 and let them reneg on their debts. Deal with the losses this means. Let them start over with a new currency.
I'm pissed because this should have been done back when the banksters sat on the IOU:s. This should have been implemented in 2010 already.
"There's also the question of who borrowed and spent it all and
now sits with the debt."
Yes, exactly. The Greek taxpayers spent it you think? (Who ‘sits with the debt’ is still an open question). I'm thinking government corruption usually winds up in the pockets of politicians and their financiers.
"I just don't want to end up paying it either."
Then don't. Not paying for it in the first place is an entirely different thing from paying for it up front, with or without protest, and then trying to bill those young Greeks you pretended you felt sorry for, so the ‘banksters’ can cover their losses with your help.
"The Greeks want to keep that whole deal going and demand
future payments also…"
I've not been critical of any decision to not fund further Greek extravagances. I ain't said squat about ya'll providing new money. I've criticized the EU effectively working as the collection agents for the banksters, and I will continue to do so.
I see little difference, except of course that Greece is a country as opposed to an individual, between what the banks did in this situation and what they did with our real estate debacle. That is, make loans to people who could ill afford to pay them back. Eventually the whole house of cards had to collapse.
So, write off, or restructure the loans. Give those people who would act in good faith to rebuild Greece's economy a helping hand. Greece needs to look carefully at raising revenue through higher taxes and judiciously cutting spending. They have to be careful not to further damage an already devastated economy. Some encouragement of outside private investment is needed.
But if there is a lesson to be taught it is not just for those who overspend. The bankers who willfully ignored the rules of proper lending practices need to be taught as well that this is not to be repeated.
"The bankers…need to be taught as well…"
I have little faith that's gonna happen. The rules as they are now encourage this sort of thing; short-term profits, get your bonus, and move on; try to be working somewhere else when the bottom falls out.
Yeah, I know. Mine is a bit of a pipe dream. *sigh*
For a bit of a change of pace, here is the twitter feed for the New Horizons Pluto mission. Kind of interesting.
Huh! Well, what do you know, maybe that isn't such a pipe dream after all. Yeah, I know, it doesn't sound like much, but still it's a start...
Four Marines killed in shooting in Chattanooga, TN.
The Empire Strikes Back; George Friedman of Stratfor on the recent EU/Greek stare-down.
"Four Marines killed in shooting in Chattanooga, TN."
ISIS is already claiming credit, and the shooter is already dead.
Sounds like they've agreed on a 7 billion-euro bridge loan to keep Greece afloat until they can agree on the main bailout package.
It looks like some, like the UK, who are not in the eurozone, want safeguards that they won't be on the hook for any of this money.
It sounds like they had an overwhelming number of volunteers waiting to give blood in Chattanooga.
"…7 billion-euro bridge loan…"
At least half of that is imaginary, maybe all of it. They're just rolling over a €3.5 billion note from the ECB for half of it; I'm not sure where the rest is going. What you want to keep your eyes on is the amount of money going into Greek banks to maintain ‘liquidity’, i.e. cash for withdrawals if somebody shows up wanting cash to take down to the grocery store or the pharmacy today. Near as I can tell none of this money is real money going into Greece. To-wit:
"‘I would expect that Mario Draghi [(president of the ECB)] will
consider now turning on the tap to some extent of emergency liquidity
to keep the banks in Greece having money for their customers,’ Kenny
said in an interview with [an] Irish broadcaster."
I take it from that quote that they're thinking about letting some of the money go into Greece, but they haven't decided to do that yet. Meantime all of it gets reported as if it were new money lent to Greece, which it most certainly is not. Real money will be affiliated with something called the ELF, the Emergency Liquidity Fund.
An ISIL affiliated group in the Sinai has claimed responsibility for a missile attack on an Egyptian navy vessel.
They're just rolling over a €3.5 billion note from the ECB for half of it; I'm not sure where the rest is going.
Basically just deferring Greek repayment while loading on more debt to make it even more impossible to pay back.
Another article on that missile attack.
Greece's economy could shrink by 4% this year.
"…while loading on more debt…"
I take that's in reference to the unexplained €3.5 billion? Going with that assumption…
It may well be nothing more than allowed access to the ELF. I think Greece is approved for a ‘line of credit’ on that fund (managed by the European Central Bank--the ECB) capped in an amount running between €80-€90 billion. The ECB has been limiting access to that line of credit, demanding Greek compliance with Germany's requirements from day-to-day. They've been doling out the money in drips and drops. (It's the source of those €60 Euro withdrawals from ATM machines you've seen on the news). Of course, if you don't actually have access to the money, it's not really on open line of credit, but I'm not sure what we should call it. Whatever…
I'm not sure whether the unexplained €3.5 billion is approved access to that line of credit, or a potential increase on the cap. If it's the later, then it's totally illusory at this point. If it's the former then it's not a new load at all.
Of course, it may be something else entirely, but I'm not sure what it'd be.
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"An ISIL affiliated group in the Sinai…"
They've been around a lot longer than ISIS has been around; but they used to claim affiliation with the Egyptian Muslim Brotherhood.
And it does begin to look like the IMF (not dominated by Germany) is beginning to push back against German theory that the way to make the Greek government solvent is to crash what remains of the Greek economy.
This guy's got a fairly clear, and succinct, explanation for why the Republicans hate the nuclear deal with Iran (other than that it's Obama's doing, of course, which is enough reason for them in itself).
"But behind [Obama's] drive for an Iranian nuclear deal is the effort to
make American foreign policy ‘solvent’ again by bringing America’s
ends into alignment with its means. That means recognizing that the
United States cannot bludgeon Iran into total submission, either
economically or militarily. The U.S. tried that in Iraq.
"It is precisely this recognition that makes the Iran deal so infuriating
to Obama’s critics. It codifies the limits of American power. And
recognizing the limits of American power also means recognizing the
limits of American exceptionalism. It means recognizing that no matter
how deeply Americans believe in their country’s unique virtue, the
United States is subject to the same restraints that have governed
great powers in the past. For the Republican right, that’s a deeply
unwelcome realization."
The Atlantic
We might also remember that all this howlin’ ‘bout the special need to believe in ‘American Exceptionalism’ didn't get going until the neo-cons lost their control over the White House. As long as they were in control of foreign policy, it didn't matter so much to them what the rest of us thought.
Final note on the Greek economic mess. Greek banks have booked deposits of between €130-€140 billion. Obviously, they do not have that much cash on hand. I presume that any of these deposits which might be guaranteed are guaranteed by the Greek government, and not by the EU. The Greek government obviously doesn't have that much cash on hand either; they are currently running a slight budgetary surplus, but they're not going to pull €135 billion Euros from somewhere out of the back room somewhere. If Greek citizens can get their hands on any cash Euros, the second thing they do with them (after buying lunch) is to get the Euros out of Greece and deposited into a bank guaranteed by someone lookin’ more solvent (i.e. Germany). But it would be good for the Greeks to get as much of those deposits as possible off the bank books in Greece and in cash in pocket or on the books of German banks, or French banks, or just ‘bout any other body's banks. This is called a ‘bank run’ and we don't have them over here since the FDIC was instituted in the 1930s, except in the shadow banking system, which supposedly at any rate, does not have U.S. government deposit guarantees.
It's the ELF that's keeping those Greek ATM machines going at present. When and if they quit running the Greeks will have to reconsider whether or not it's rational to keep cooperating with the EU austerity demands.
That means recognizing that the United States cannot bludgeon Iran into total submission, either economically or militarily. The U.S. tried that in Iraq. "It is precisely this recognition that makes the Iran deal so infuriating to Obama’s critics. It codifies the limits of American power. And recognizing the limits of American power also means recognizing the limits of American exceptionalism.
Hmmm...I read and reread this paragraph because something about it bothered me. Looking at the definition of "American exceptionalism" that the author linked to I just don't see where Obama's actions in coming to a deal with Iran over their nuclear ambitions is a sign of limiting it. Using military force is not necessarily the only way we could intervene in foreign affairs if it was a situation that was in our interest. A war with Iran is not in our interest, but lengthening their breakout time to a nuclear bomb is. If this deal works as designed it will hopefully achieve that.
Personally I think the decline of "American exceptionalism" has more to do with the decline in the religious leaning of many Americans more so than either of the other two factors listed.
If U.S. officials reject a deal, Iran’s historic trading partners will not economically injure themselves indefinitely. Sanctions, declared Britain’s ambassador to the United States in May, have already reached “the high-water mark,” noting that “you would probably see more sanctions erosion” if nuclear talks fail. Germany’s ambassador added that, “If diplomacy fails, then the sanctions regime might unravel.”
Understanding the cards you have to work with is just as important as how you play them. Sometimes being pragmatic is the wisest path. A great power would understand that.
"I just don't see where Obama's actions in coming to a deal with
Iran over their nuclear ambitions is a sign of limiting it."
I think you've hit a semantic difference, a semantic misunderstanding, with the author. (I think that's it; I stumbled over that particular sentence too.)
Merriam-Webster
codify verb cod·i·fy \ˈkä-də-ˌfī, ˈkō-\
: to put (laws or rules) together as a code or system
: to put (things) in an orderly form"
I think you were thinking of the first line meaning, where one creates the code to govern how things will be, and the author was thinking of the second line meaning, where one arranges to deal with things as they already are, in an orderly manner. Tell ya what… Strike that sentence in it's entirety--pretend it's not even there, and read it again. I'll bet it reads smoothly across. And that's because he was using the word in an unfamiliar manner (but it is in the dictionary that way, so he probably knew what he meant).
"Personally I think the decline of ‘American exceptionalism’ has
more to do with the decline in the religious leaning of many Americans
more so than either of the other two factors listed."
I decided to think this part over… I'm not sure I follow that part about ‘the decline of "American exceptionalism"’. To what in particular are you making reference?
First let me say that whenever I have thought of the term "American exceptionalism" I have thought of it using this terminology. The National Journal article, which I am having problems accessing this morning or I would quote from it directly, condenses it to mean something to the effect that America is at heart a majority religious country, that we have a special place in the world that lends itself to our intervention in foreign affairs and that we are an upwardly mobile society. I just went with the flow of that author's perspective when I wrote my opinion of his viewpoint.
It means recognizing that no matter how deeply Americans believe in their country’s unique virtue, the United States is subject to the same restraints that have governed great powers in the past.
I just think this guy is obsessing too much about the connection between Republicans and any idea they might have about any inherent place the US has to intervene in foreign affairs as part of "American exceptionalism". They were, after all, against intervention in Libya.
No, I think he is overthinking their opposition to the Iran deal. They don't like it because the Democrats, or Obama in particular, came up with it. And there are just too many of them out there who are not willing to listen to the warnings about the downside to other various options, such as continuing sanctions.
But on another note, while I think a deal was necessary, my question at this time is where is the existing Iranian stockpile of enriched uranium, which they are cutting back on, going to be transferred to?
Iran deal particulars
I'm not sure I follow that part about ‘the decline of "American exceptionalism"’. To what in particular are you making reference?
The author was talking about our limits in projecting power in foreign affairs, I was referring to a general feeling that organized religion is in decline, or perhaps the organized religion as we know it. But maybe that is just my perception where I am at.
Off to do errands. Got most of my cleaning done yesterday. Maybe I'll actually get a chance to do a little reading today...:)
I know I won't have to water, we've gotten around 4 inches of rain this week. Amazing how green things still look.
"They were, after all, against intervention in Libya."
I'd argue they were against it only because Obama did it, and only after he did it. While Obama was being reluctant they were chastising him over his foot dragging and especially over that ‘leading from behind’ comment--their view, we were supposed to be leading from up front and out in front, exporting democracy to the Arabs (except in the cases of Egypt and the Sunni monarchies) and ♪♫bomb-bomb-bomb; bomb-bomb Iran♫♪.
While I was thinking about it, I had thought I'd reduced it down to an analogy I could make from the ‘shining city on a hill’ theme which goes back to the Puritans and John Winthrop. It was originally a metaphor about a destination, a place people wanted to get to, but also a romantic image, a reminder to the rest. (And, as the far-off place, it fit in well with the isolationist impulses of most Americans.)
It was with Reagan's appropriation of the metaphor in the 1980s that it became a neo-con staple metaphor suggesting that we were imbued with some sort of superior wisdom and morality which would justify us telling other folks how to live their own lives in their own houses.
I was amused to find that connection cited in your Wiki definition.
" And there are just too many of them out there who are not willing
to listen to the warnings about the downside to other various options,
such as continuing sanctions."
They do not acknowledge any downsides. All of those can be overcome if we just talk tough enough, so there's no point in wasting time on them. "We're tough enough, everybody knows we're tough enough, if we just talk tough enough they'll buckle under." That's what those folks think, and it's at that point that they refuse to think about it any further.
115 killed in a suicide attack in Iraq. Apparently ISIL has used chemical weapons against the Kurds in both Syria and Mosul as well.
I was amused to find that connection cited in your Wiki definition.
Aha! Obviously I didn't read down far enough. lol!
I just read to here:
American exceptionalism is the theory that the United States is inherently different from other nations.[2] In this view, American exceptionalism stems from its emergence from the American Revolution, thereby becoming what political scientist Seymour Martin Lipset called "the first new nation"[3] and developing a uniquely American ideology, "Americanism", based on liberty, egalitarianism, individualism, republicanism, democracy and laissez-faire. This ideology itself is often referred to as "American exceptionalism."[4]
I didn't read the next paragraph:
Although the term does not necessarily imply superiority, many neoconservative and other American conservative writers have promoted its use in that sense.[4][5]
Yes, I can see why that might amuse you. :)
I wonder where they're getting chemical weapons? (Chlorine, of course, has civilian uses and was never on the chem/weapons list for surrender by Assad.) If they're cooking up their own stuff now, that's not a particularly good sign.
¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯
Getting back to that ‘American Exceptionalism’ argument. The Atlantic piece noted a serious increase in media usage of the term after the election of Obama (more than three-fold increase over the Dubya years). I'd take it further back, and (although I don't have stats to back this up) I'd argue that media usage of the term was way up in the Dubya years over the Clinton years, and before that.
Usage of the term has risen with the rise of the partisan media, specifically, Radio-Right-Wing and FoxNews, where they have nurtured and promoted the neo-con concept that some sort of ‘American Exceptionalism’ meant that we had both the means and the right to impose our will on the rest of the world.
I think most Americans still believe this is a special place. This is the place where membership was based on acceptance of the ideals, and not on ethnicity, not on being born to it. But, I think Americans reject the terminology now because they've come to reject the neo-con notion that we have both the means and the right to impose our will on the rest of the world, and that's been the media definition for that terminology for several years now.
If they're cooking up their own stuff now, that's not a particularly good sign.
No, it's not. I have always felt that the danger was not in what Saddam had laying around the place, but in the knowledge that could be found within the Baath party. If there are members of the Baath within ISIL who have the knowledge to create this type of weapon then that is a major concern.
From what I read it appears they are not sure what was used.
Usage of the term has risen with the rise of the partisan media, specifically, Radio-Right-Wing and FoxNews, where they have nurtured and promoted the neo-con concept that some sort of ‘American Exceptionalism’ meant that we had both the means and the right to impose our will on the rest of the world.
One might argue here that we have had an inordinate influence on the world, for good or ill, depending on how you view our culture. :)
There has always been this sew-sawing back and forth in the United States between isolationism and a more interventionist stance. The neo-con ideology is of the latter bent.
The conservative mind set certainly believes that we have the right to self defense, which is what they were working under when we invaded Afghanistan. Iraq was a stretch.
The choice in Iraq was almost exactly the same choice as we have with Iran. Continue with sanctions that are only going to erode as people break them, which was already happening in Iraq, or attempt some other way to effect change. In the case of Iraq we went to war, in the case of Iran we negotiated.
The question of do we have the means to impose our will, well in these two cases we tried vary different approaches. The first did effect change, certainly, but not necessarily a change we would have wanted. The second only time will tell whether it worked.
The question of do we have the right to impose our will depends upon what we are trying to achieve. If we are attacked we certainly have the right to self defense. But do we have a right to force others to remake themselves in our image? This is a moral question that we each have to examine very carefully.
There is a danger in our intervening, but also in not doing so. If we had the means to foretell the future it would be far easier to decide what course to take. But we are mere mortals with no such extra-ordinary power. :)
I think most Americans still believe this is a special place. This is the place where membership was based on acceptance of the ideals, and not on ethnicity, not on being born to it.
I would agree with this. If you come here you are choosing to join in this endeavor to achieve the ideals laid out in our constitution. Because of this you will find many people quite willing to help new immigrants if possible.
But, I think Americans reject the terminology now because they've come to reject the neo-con notion that we have both the means and the right to impose our will on the rest of the world, and that's been the media definition for that terminology for several years now.
This is the see-sawing I mentioned earlier. That doesn't necessarily mean it will continue on this track. This is still a reaction to the Iraq war. We saw it after Vietnam. After WWII we were quite content to proceed into the Korean War as well as the Cold War. Both implied that we thought we had the means and the right to impose our will on the world.
"From what I read it appears they are not sure what was used."
It also appears it was only marginally effective for its intended purpose. I thought that might indicate a home-brew (or it may have been an attempt to use one of those ancient chem/weapons that occasionally turned up, having been misplaced by Saddam's Ba'athi regime).
"The conservative mind set certainly believes that we have the right
to self defense…"
The liberal mind set generally believes that too. And conservatives can be isolationists, but even they generally agree to self-defense.
There is, however, a certain sub-set out there who've been itching to win an intervention every since Vietnam. (In fact, stick with ‘em long enough and they'll get back to their faerie tale about how we actually won in Vietnam and that victory was thrown away at the last minute by the damned liberals; a sort of American dolchstoßlegende for which they've been seeking to redeem their interventionist tendencies since the 1970s.) These guys manage to convince themselves that we have not only the right, but also the means to settle every international conflict in our own favor--we have the power they think. Well, we don't have that much power. We're not gonna take on the whole rest of the world and win; ain't gonna win that one, but they don't believe it. But you mistake the motive behind the Cold War (which includes the Korean conflict). We went into that because we were afraid that the Soviet Union had, or would acquire, the means to impose their will on the world if we didn't stop them.i
I thought that might indicate a home-brew (or it may have been an attempt to use one of those ancient chem/weapons that occasionally turned up, having been misplaced by Saddam's Ba'athi regime).
Hopefully it was the second option there. The first would show an effort to step up their game. There is a third option, and that is that the substance was acquired in Syria and just shifted to whatever battlefield they felt it may prove useful.
There is, however, a certain sub-set out there who've been itching to win an intervention every since Vietnam.
Probably so. There will always be those who believe that they have to "win one for the Gipper". Call it a pride thing, perhaps. But as you said here:
But you mistake the motive behind the Cold War (which includes the Korean conflict). We went into that because we were afraid that the Soviet Union had, or would acquire, the means to impose their will on the world if we didn't stop them.
There is a genuine concern by some that we need to stand firm about our beliefs or they will gradually erode and morph into something that most of us would not want. So you get this attitude that we need to do something. It's a very American way of thinking. :) And depending upon what course we take we will always find someone who believes there is a better choice, even if they cannot put forth another idea.
We saw Nikita Khrushchev standing at the podium of the United Nations and fairly explicitly saying, ‘We will bury you’, whilst shaking a clenched fist in the air.
Gradual erosion wasn't the fear.
Just a small side trip back to the eurozone...
The euro, bad for business?
Hmmm...so how do they fix the problems there if the basic structure of having a common currency is actually part of the problem?
We saw Nikita Khrushchev standing at the podium of the United Nations and fairly explicitly saying, ‘We will bury you’, whilst shaking a clenched fist in the air.
True. But I have to confess to finding that "Death to America" thing just a little off putting.
"I have to confess to finding that ‘Death to America’ thing just a
little off putting."
Indeed. I must confess to having dreamed up a few non-conventional, asymmetric responses to those over the years.
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